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DIVIDEND POLICY AND ITS RELATIONSHIP TO INVESTMENT AND FINANCING POLICIES: EMPIRICAL EVIDENCE
Author(s) -
Partington Graham H.
Publication year - 1985
Publication title -
journal of business finance and accounting
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.282
H-Index - 77
eISSN - 1468-5957
pISSN - 0306-686X
DOI - 10.1111/j.1468-5957.1985.tb00792.x
Subject(s) - dividend policy , dividend , investment (military) , debt , empirical evidence , economics , investment decisions , dividend yield , finance , financial economics , debt financing , investment policy , monetary economics , business , macroeconomics , behavioral economics , foreign direct investment , philosophy , epistemology , politics , political science , law
In this paper it is argued that dividend policy is not determined as a residual, but rather that firms adopt independent dividend and investment policies. Empirical evidence, based on a questionnaire survey, supports this view. Independent dividend and investment policies are possible because debt finance is usually raised in sufficient quantities to accommodate the financial demands created by dividend and investment decisions.